Yellow Corporation tried to steal billions from its own employee’s pensions.

Yellow Was One of America’s Biggest Truckers. Then It Walked Away.

A Corporate Giant Goes Dark — And Leaves 30,000 Workers In the Cold

Yellow Corporation was not some regional outfit. It was one of the largest trucking companies in the United States. When it could not resolve a labor dispute with the Teamsters union, it simply shut down in July 2023 and filed for bankruptcy the following month. Tens of thousands of workers lost their jobs and their futures overnight.

The workers Yellow left behind had paid into multiemployer pension plans — MEPPs — for their entire careers. These are shared retirement pools where multiple employers contribute through collective bargaining agreements. The money belongs to the workers. The plans exist to guarantee those workers can retire with dignity.

When Yellow walked out, it triggered “withdrawal liability” — the legal obligation for a departing employer to pay its proportional share of the unfunded gap it leaves in the pension plan. Under the law, a company cannot simply abandon a pension obligation. Someone has to pay for the hole it leaves. Yellow’s position was that someone else should.

The Math Yellow Wanted to Rewrite

The formula for withdrawal liability is straightforward: the value of pension benefits owed to workers, minus the value of the plan’s assets. The bigger the asset base, the smaller Yellow’s bill. Yellow’s entire legal strategy centered on making that asset base look as large as possible.

Eleven pension funds filed 174 separate proofs of claim in Yellow’s bankruptcy case. Their combined demand: $6.5 billion (enough to pay the annual grocery bills of roughly 130,000 working-class families for a full decade). That is the number Yellow spent years of litigation trying to shrink.

The specific target of Yellow’s legal attack was the American Rescue Plan Act of 2021 — the COVID relief law that pumped emergency funding into struggling pension plans specifically so workers’ retirement benefits would survive through at least 2051. Yellow’s argument, stripped of legalese, was this: that public emergency money should count as the pension plans’ assets, which would reduce Yellow’s private debt. The court found that argument had no legal foundation.

What the Dollar Figures Cannot Capture

These Weren’t Numbers in a Spreadsheet. They Were People’s Plans for the Future.

Every dollar in those pension funds represents a worker who showed up to a truck terminal before dawn, drove through rain and snow, and trusted that the deal they made would hold. These were Teamsters — members of the New York State Teamsters Conference, the Central States Fund, Road Carriers Local 707, Teamsters Locals 617, 641, 701, and more. They contributed to these plans through collective bargaining agreements, meaning they traded some of their wages for the promise of a stable retirement. That promise was not charity. It was a contract.

When Yellow shut down in July 2023, those workers did not just lose jobs. They lost seniority, healthcare tied to employment, and the daily structure that defines a working life. For many truck drivers, particularly those in their 50s and early 60s who were close to retirement eligibility, there is no equivalent job waiting. The skills are real, the body is worn, and the industry does not hand out do-overs. Yellow’s collapse happened without warning, without transition support, and without any accountability for the human wreckage it left behind.

Then Yellow’s investors attempted to compound the damage. The appellants in this case included not just Yellow Corporation, but MFN Partners LP and Mobile Street Holdings LLC — hedge-fund-style creditors who had an economic stake in reducing Yellow’s liabilities. These were not workers. These were financial entities that stood to benefit if Yellow’s pension obligations could be legally shrunk. Their participation in the lawsuit made the stakes explicit: on one side of this courtroom sat pensioners; on the other sat creditors calculating their returns.

The specific mechanism Yellow tried to exploit deserves naming clearly. Congress passed the American Rescue Plan Act in 2021 specifically because multiemployer pension plans were on the verge of collapse due to COVID-era economic devastation. The law was an act of public solidarity — taxpayer dollars, directed to protect working people’s retirement savings. Yellow’s legal team argued that this public lifeline should effectively reduce the private debt Yellow owed those same workers. The company wanted to convert a gift to workers into a discount for itself. The court rejected that logic entirely, but the fact that a company with high-powered legal representation from firms like Kirkland & Ellis and Quinn Emanuel spent years pursuing this argument tells you everything about who corporations believe the rules are written for.

The Reentry Deal That Yellow Also Tried to Break

There is a second betrayal in this case that received less attention but cuts just as deep. In 2013, Yellow had previously withdrawn from the New York Teamsters Fund and the Western Pennsylvania Teamsters Fund. The funds allowed Yellow to come back — to reenter — under specific conditions. Yellow was permitted to contribute at a deeply discounted rate, as low as 25% of the normally required contribution level. This meant the workers in those plans received diminished benefit accruals for years while Yellow enjoyed the cost savings.

The trade-off Yellow agreed to in writing was this: if it ever withdrew again, it would face withdrawal liability calculated at the full 100% contribution rate. Workers took a worse deal for years. Yellow pocketed the savings. Then, when the moment of reckoning arrived in bankruptcy court, Yellow argued it should not have to honor the agreement. It claimed the contractual 100% rate was illegal — a violation of the statute — because the plans had not received separate regulatory approval for the calculation method. The bankruptcy court and then the appeals court saw through this immediately.

The court’s conclusion was blunt: Yellow bargained for a discount on its contributions by offering to pay full freight on its withdrawal liability if the time came. The time came. The workers who absorbed those diminished accruals for years deserved the full protection of the deal that was made. Yellow’s attempt to escape it, mid-bankruptcy, was not a technical legal argument. It was a second attempt to extract value from the workers it had already shortchanged for a decade.

The Court Said It Plainly. Here Are the Receipts.

Verbatim From the Bench — No Paraphrase, No Spin

“Congress has expressly granted the PBGC the type of gap-filling authority that Loper Bright described, both in ERISA as originally enacted in 1974 and again in the provisions of [ARPA] that are directly at issue here.” — Bankruptcy Court, In re Yellow Corp., 2024 WL 4925124, at *7, as quoted and affirmed by the Third Circuit

“Yellow’s argument ‘rests on’ the ‘unfounded assumption’ that Yellow has ‘a claim’ to the special financial assistance funds. It does not. Before ARPA was passed, Yellow was ‘obligated to pay withdrawal liability to’ the MEPPs. These regulations ‘merely preserve[] the status quo and prevent[] [ARPA] funds from being redirected to participating employers by reducing their withdrawal liability.'” — Third Circuit Court of Appeals, quoting PBGC’s answering brief, affirming the lower court’s ruling against Yellow

“Yellow plays the doctrine as a get-out-of-regulation-free card, but we decline to accept that move.” — Third Circuit Court of Appeals, rejecting Yellow’s use of the “major questions doctrine” as a shield against pension regulations

“The MPPAA establishes mandatory liability, overriding contracts that allowed firms to withdraw with an effective transfer of unfunded liability to the federal Treasury. It does not forbid employers from agreeing to pay extra money to a pension trust.” — Bankruptcy Court, In re Yellow Corp., 2024 WL 4925124, at *17, quoting Artistic Carton Co. v. Paper Indus. Union-Mgmt. Pension Fund (7th Cir. 1992), as affirmed by the Third Circuit

“Seeking to reenter these pension plans, it bargained for a discount on its contributions by offering to pay full freight on its withdrawal liability if the time came. It is here.” — Third Circuit Court of Appeals, on Yellow’s attempt to escape the 2013 reentry agreement with the New York and Western Pennsylvania Teamsters Funds

“Industry stakeholders, including employers, pension plans, actuarial firms, law firms, individuals, and members of Congress weighed in. There was even a ‘listening tour.’ The main thrust of the feedback was a concern that if special financial assistance were immediately recognized in the calculation of unfunded vested benefits, employers would withdraw from the pension plans — leaving those who remain holding the bag.” — Third Circuit Court of Appeals, describing the extensive regulatory process that produced the PBGC rules Yellow challenged

This Was Never Just About Yellow. The Entire Pension System Was on Trial.

Public Health: What Retirement Insecurity Does to Working Bodies

Truck driving is physically brutal work. Spinal injuries, sleep disorders from irregular schedules, cardiovascular stress, and repetitive strain injuries accumulate over decades behind the wheel. The promise of a pension is not a luxury for these workers — it is the medical and financial lifeline that makes those physical costs bearable. When pension security is threatened, the downstream health consequences are direct and severe.

Workers who lose retirement certainty delay healthcare decisions they can no longer afford, return to physically demanding work past the age their bodies can handle it, and experience documented increases in anxiety and depression linked to financial precarity. Yellow’s bankruptcy did not just threaten money. It threatened the health outcomes of tens of thousands of workers and their families who had built their lives around the expectation that their pensions would be there.

The court’s ruling that ARPA funds cannot be redirected to reduce corporate withdrawal liability matters for public health because it protects the long-term solvency of funds that are the only healthcare-adjacent financial safety net for hundreds of thousands of union retirees. The alternative — the reality Yellow was fighting to create — would have set a precedent that any sufficiently large bankrupt employer could use public emergency relief to gut its pension obligations, destabilizing the entire multiemployer pension system.

Economic Inequality: The Anatomy of a Wealth Transfer Attempt

The parties pushing hardest against the PBGC regulations were not Yellow’s workers. They were MFN Partners LP and Mobile Street Holdings LLC, financial entities with a creditor stake in Yellow’s bankruptcy estate. Their economic incentive was clear: every dollar shaved off Yellow’s pension liability is a dollar that potentially flows to other creditors, including themselves. This is the pure mechanics of how wealth transfers from workers to investors inside a bankruptcy proceeding.

Congress appropriated the $41.1 billion (a sum larger than the annual GDP of a country like Iceland) in ARPA special financial assistance from public funds. Taxpayers funded it. The money was directed specifically at protecting working-class retirees whose plans were underfunded through no fault of their own. Yellow’s legal argument, if successful, would have converted a portion of that public investment into a private benefit for a bankrupt corporation and its creditors. The court described this clearly: the funds would have become “an unintentional withdrawal-liability subsidy.”

The court also noted a particularly sharp concern raised during the PBGC’s public rulemaking process: if ARPA funds counted immediately as full plan assets, savvy employers would rush to withdraw from pension plans at a discount, triggering a cascade of additional withdrawals in a death spiral that would destroy plans. The workers who stayed in those plans — and their employers who honored their obligations — would be left holding the collapse. The PBGC’s regulations exist to prevent exactly this extraction dynamic, and the court upheld them on precisely those grounds.

The inequality in legal resources on display in this case also demands acknowledgment. The pension funds were represented by capable counsel, but Yellow’s legal team included Kirkland & Ellis — one of the highest-billing law firms on earth — and Quinn Emanuel, another firm that commands premium rates. The Teamsters funds and the PBGC went up against some of the most expensive legal firepower money can buy. The fact that they won does not erase the structural imbalance. It simply means that, this time, the law was clear enough that money could not obscure it.

Put the Numbers in Human Terms

Who Is Watching and What You Can Do

The Regulatory Bodies That Stood Between Workers and Corporate Extraction

Named Corporate Roles in This Case

• Yellow Corporation — Debtor and primary appellant. Sought to use COVID relief funds as a pension liability discount.
• MFN Partners LP — Creditor-appellant. Financial entity with economic incentive to reduce Yellow’s pension obligations.
• Mobile Street Holdings LLC — Creditor-appellant. Co-filed the primary brief challenging the PBGC regulations alongside MFN Partners.
• Kirkland & Ellis / Quinn Emanuel — High-billing corporate law firms retained to fight the pension regulations. The workers were on the other side.

The Ruling Held. The System That Made It Possible Needs Your Protection.

This case ended well because the law was clear and the regulatory record was solid. The PBGC ran a listening tour. Unions showed up. Workers’ advocates submitted comments. The rules got written. And when Yellow challenged them, the rules held. That is not an accident — that is what functioning democratic regulation looks like, and it requires constant defense.

Find your nearest union, support labor organizing in your workplace or community, and pay attention to any congressional effort to limit the PBGC’s authority to set conditions on pension assistance funds. Mutual aid networks that support laid-off workers and retirees facing benefit cuts are doing the work that no court ruling can do: keeping people fed, housed, and connected while the legal machinery slowly turns. Seek them out. Fund them if you can. Build them if they don’t exist.

Yellow’s workers did not win a windfall today. They won the right to receive what they were already owed. That is how low the bar is. And corporations keep trying to move it lower.